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Unieuro S.p.A. Investor Presentation
October 2017
2
This documentation has been prepared by Unieuro S.p.A. for information purposes only and for use in presentations of Unieuro's results and strategies.
This presentation is being furnished to you solely for your information and may not be reproduced or redistributed to any other person or legal entity.
This presentation might contain certain forward looking statements that reflect the Company’s management’s current views with respect to future events and financial and operational performance
of the Company and its subsidiaries.
Statements contained in this presentation, particularly regarding any possible or assumed future performance of Unieuro S.p.A., are or may be forward-looking statements based on Unieuro
S.p.A.’s current expectations and projections about future events, and in this respect may involve some risks and uncertainties. Because these forward-looking statements are subject to risks and
uncertainties, actual future results or performance may differ materially from those expressed in or implied by these statements due to any number of different factors, many of which are beyond
the ability of Unieuro S.p.A. to control or estimate.
You are cautioned not to place undue reliance on the forward-looking statements contained herein, which are made only as of the date of this presentation. Unieuro S.p.A. does not undertake any
obligation to publicly release any updates or revisions to any forward-looking statements to reflect events or circumstances after the date of this presentation.
Any reference to past performance or trends or activities of Unieuro S.p.A. shall not be taken as a representation or indication that such performance, trends or activities will continue in the
future.
This presentation has to be accompanied by a verbal explanation. A simple reading of this presentation without the appropriate verbal explanation could give rise to a partial or incorrect
understanding.
This presentation is of purely informational and does not constitute an offer to sell or the solicitation of an offer to buy Unieuro’s securities, nor shall the document form the basis of or be relied on
in connection with any contract or investment decision relating thereto, or constitute a recommendation regarding the securities of Unieuro.
Unieuro’s securities referred to in this document have not been and will not be registered under the U.S. Securities Act of 1933 and may not be offered or sold in the United States absent
registration or an applicable exemption from registration requirements.
Due to rounding, numbers presented throughout this presentation may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.
Italo Valenti, the manager in charge of preparing the corporate accounting documents, declares that, pursuant to art.154-bis, paragraph 2, of the Legislative Decree no. 58 of February 24, 1998,
the accounting information contained herein correspond to document results, books and accounting records.
Safe Harbour Statement
3
• Overview of Unieuro
• Consumer Insight and Market Scenario
• Strategic Goals and Achievements
• H1 2017/18 Financials
• Closing Remarks
Summary
4
Unieuro at a glance Established by the end of 1930s, Unieuro is Italy’s leading omnichannel consumer electronics retailer by number of outlets, with sales of about €1.7bn in FY 2016/17
DOS
Wholesale
Notes: Channel and product percentages of total sales as per H1 2017/18 data; Store breakdown as of 31 August 2017; (1) Including 10 Travel Retail DOS.
Travel Retail (DOS)
Broad product range across multiple categories
Omnichannel presence maximizing proximity to consumer
Retail (DOS)
(70%)
Wholesale
(12%)
B2B
(7%)
Online
(9%)
Travel Retail (DOS)
(2%)
Nationwide coverage with network of 193 DOS in strategic locations
10 stores located in main Italian airports and train stations
273 wholesale partners operating exclusively under Unieuro banner Further extended coverage in smaller catchment areas Wholesale supply to supermarkets and other retailers
In-store collection and home delivery options Distinctive online platform among electronics retailers in Italy E-tailer Monclick consolidated from 1 June 2017
Supply of bulk quantities to non-retail electronics traders and hotels
Grey goods
(47%)
Brown goods
(17%)
Other Products
(5%)
Services
(4%)
White goods
(28%)
Mobile, IT, accessories, photography, wearables
MDA, e.g. washing machines, cooking appliances, dishwashers SDA, e.g. coffee machines, microwaves Home comfort, e.g. air conditioning
Delivery and installation Extended warranties Brokerage for financial services Commissions from subscription to telecom contracts
Entertainment, e.g. consoles, videogames, music, movies Non electronic products, e.g. bicycles, drones, hover boards
TV, media storage, car accessories
Full nationwide coverage
Store breakdown by geography DOS Affiliates Total
North 60% 33% 45%
Centre 30% 27% 28%
South 10% 40% 27%
Total 203 273 476
1
24
29
9
29
18
4
3
10 5
2
37
4
3
1
8
3
1
2 5
8
14
21
19
4
30
20
5
13
31
3
10 12
35
18
5
21
4
4
5
1
5
Consistent long-term growth, comprising M&A consolidation in both offline and online channels, as well as proven organic
growth, to create Italy’s leading consumer electronics retailer 1
Integrated omnichannel presence across offline and online providing distinct competitive advantages 2
Lean and flexible organisational structure supported by unique and scalable centralised logistics
platform in Italy 3
Future growth strategy based on multiple organic levers and further market consolidation 5
6
Long-standing and experienced management team with proven track record of profitable growth 7
Highly effective customer engagement resulting in leading brand recognition 4
Italy’s leading omnichannel consolidator
Strong and profitable historical growth funded by growing, sustainable cash generation with significant
future tax savings
6
Source: Company information, Real GDP volume growth rate (% change on previous year) from Eurostat. Notes: FY ending in February; FY2014 figures include only 3 months of UniEuro; (1) Sales pre FY2014 do not include “Other” sales; (2) Business was named SGM Distribuzione prior to acquisition of UniEuro; (3) Refers to the calendar year and not to the fiscal year of Unieuro (e.g. for FY2016, refers to the period 1 January 2015 - 31 December 2015); (4) Including 193 Retail DOS and 10 Travel Retail DOS as of 31 August 2017; (5) Acquisition to be finalised.
858
1,385
1,557
1,660
813
FY 2005/06 FY 2006/07 FY 2007/08 FY 2008/09 FY 2009/10 FY 2010/11 FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2015/16 FY 2016/17 H1 2017/18
Sales(1) (€m)
DOS
21 24 35 54 65 69 68 81 178 173 181
GDP Growth (%)(3)
0.9% 2.0% 1.5% (1.1%) (5.5%) 1.7% 0.6% (2.8%) 0.1% (1.7%) 0.8%
In September 2017, Unieuro announced the acquisition of 19 stores from Gruppo Cerioni S.p.A., operating under the Euronics banner, which will add c.€90m of sales(5)
At run rate, 2017 new acquisitions (Monclick, Andreoli/Euronics stores, Euroma2 flagship store and Cerioni/Euronics stores(5)) will add c. 300 €m sales at run rate
1 - Consistent long-term growth…
180(4)
0.9%
+7 stores
operated by
+25 stores
operated by
+12 stores
operated by
+21 stores
operated by +94 stores
operated by
+8 Travel stores
operated by
203(4)
Consistent growth achieved despite a period of declining
GDP, grasping the opportunity to grow as an M&A
consolidator
7
Unieuro driving consolidation in the Italian market…
Notes: (1) Acquisition to be finalised.
.
…comprising M&A consolidation in both offline and online…
2007 Acquisition of 7 stores operated by members of
buying group
2008/
2009
Acquisition of 25 stores operated by members of
buying group
2012 Acquisition of (12 stores)
2013 Acquisition of former (94 stores)
2014 Rebranding of the whole network into the new .
Exit from Expert buying group
2015 Acquisition of 8 travel stores from .
2017
Acquisition of e-tailer .
Acquisition of 21 stores from Andreoli S.p.A., a former member of .
Acquisition of a flagship store in Rome, previously operated by a member
of buying group
Acquisition of 19 stores from Gruppo Cerioni S.p.A., a former member
of buying group (1)
…and extracting value through integration…
• Sales initiatives:
New store procedures (e.g. better selling practices through staff
training)
New commercial policies (e.g. store layout)
Enhanced marketing (e.g. digital)
Rationalisation of store organisation (e.g. store refurbishment /
branding)
• Cost improvements:
Headquarters consolidation
Logistics savings following warehouse integration
Reduction of overheads
Optimisation of personnel (incl. employee relocations)
Increased purchasing power vis-à-vis suppliers
Renegotiation of rental contracts
IT systems migration
Website & App consolidation
Marketing cost synergies
…also thanks to its centralized business model
8
…resulting in the leading company in the Italian CE market by
number of stores
473
117
59 56 45 41 28 63 53 36 NA
Mediaworld Galimberti Butali Bruno SIEM Nova DPS Copre Papino DGGroup
1,660(2) 138 340 236 2,136 177 223 81 233 273 198
(4)
Source: Company information (for Unieuro); companies’ websites and companies’ filings, Company elaborations based on market data. Notes: (1) Addressable market definition excludes sales from Entertainment category; (3) Unieuro sales refer to FY 2016/17; (4) Computed as 48% of sales of the legal entity; (5) Latest store number as at 31 Aug. 2017.
2015 Sales (€m)
21
203
FY 2005/06 Aug. 2017
473
# of DOS
+182
(3)
…to create Italy’s leading consumer electronics retailer
Expansion of DOS store network by 10x since 2006 with
total stores reaching 473 today…
Cerioni acquisition to
increase DOS store
network by 19 stores
Total # stores including DOS and wholesale partners
21
203
…and large share gains of 17pp at expense of competition…
3%
20%
FY 2005/06 FY 2016/17
+2 p.p. gained vs.
FY 2016/17
+17 pp
302 €m
9.4 €bn
1,884 €m
9.6 €bn
Sales, excl. warranties and entertainment, incl. VAT. Source: Company information.
Addressable market (€bn)(1). Source: Company elaborations based on market data.
# of stores (2015)
Member of Eurnocis buying group
Member of Trony buying group
Member of Expert buying group
9
Notes: Stores breakdown by format as at 28 Feb. 2017 (1) As at 31 Aug. 2017; (2) Excluding 10 Travel Retail DOS.
2 - Integrated omnichannel presence across offline and online
Retail (DOS)
70%
Focus on malls and city centre
locations with store average size of
c.1,500 sqm
Modern, engaging store layout
designed to maximise product
visibility
Wide range of store formats
Favourable lease terms with short
notice break clause permitting rapid
response to local market trends
Travel Retail (DOS) 2%
10 stores located in main Italian
airports and train stations
Focus on “grey” and “brown” goods
Exposure to favourable
travel dynamics
Reduced space (c. 100 sqm)
allowing proximity to products
On-the-go impulse purchases
Marketing tool to increase brand
visibility
Wholesale 12%
Stores in smaller and more remote
catchment areas
Allows further penetration across
whole Italian territory
Unieuro brand / store format
Exclusive supply
Limited central costs, no capex and
positive impact on profitability
Online 9%
Brand-new website optimised for mobile navigation with additional functionality from 2016 (e.g. mirroring, smart assistant, instant search)
“Click & Collect” driving traffic to stores: 385 pick up points, 83% of total stores
Integration of online and offline channels
New mobile app launched in November 2016
Pure player Monclick acquired
B2B 7%
Rome (Fiumicino)
5 stores
Milan (Malpensa,
Linate, Bergamo)
4 stores
Turin (Porta
Nuova Station)
1 store
Opportunistic business
Includes agreements with companies producing vouchers to be used at Unieuro stores
Direct bulk supply to:
− Corporate customers
− Electronics traders
− Foreign customers
Announced Monclick acquisition positions Unieuro as a first mover in the B2B2C adjacent market segment
Su
mm
ary
Ove
rvie
w
Con
trib
utio
n to
H1
17
/18
to
tal sa
les
<1,000 sqm
12%
1,000–2,000
sqm; 69%
>2,000 sqm
19%
<500 sqm
69%
500–1,000 Sqm; 26%
<1,000; 5%
10
3 – Lean and centralised organisational structure…
Notes: Data as of 31 Aug. 2017; (1) 2 agents employed by Unieuro.
Centralised decision-making in the Forlì HQ allowing for fast execution and
efficient decision making process
Board of Directors
CEO
Giancarlo Nicosanti Monterastelli
Chief Omni-channel Officer
Bruna Olivieri
Chief Corporate Development
Officer
Andrea Scozzoli
Chief Operating Officer
Luigi Fusco
Chief Commercial Officer
(ad interim Nicosanti)
Chief Financial Officer
Italo Valenti
Supply chain
Service & logistics
Direct channel
Indirect channel
B2B
Security
ICR
HR
Commercial admin.
Category management
Marketing intelligence
Digital marketing
CRM
Finance & treasury
Admin. & control
Legal
Investor Relations
Property management
Technical office &
facility management
Internal audit
Business development
and M&A
Marketing
• 5 Key decision makers at central level
− CEO (and interim Chief Commercial
Officer)
− Chief Operating Officer
− Chief Omnichannel Officer
− Chief Financial Officer
− Chief Corporate Development Officer
• 275 FTEs in the HQ, growing
proportionally less than sales
• 3,543 in the stores and 10 agents(1):
highly flexible workforce permitting Unieuro
to preserve maximum productivity and
adjust labour costs
11
Centralised warehouse located in one of main Italian
logistics hubs (Piacenza)
National coverage to all stores and channels (Retail,
Wholesale, Online and B2B)
Favourable solution for suppliers – avoids multiple
shipments and lowers Unieuro procurement costs
Significant capacity headroom through site expansion
Centralised delivery centre
Transit points managed by
third parties
50,400 sqm of current total surface area. Capacity to
double in 2018
Piacenza
89% of DOS stores within 600 km from Piacenza
(“Click & Collect”)
Retail (DOS)
Online customers
Wholesale
B2B
Travel Retail (DOS)
Delivery Centre
(“DC”)
(“Click & Collect”)
…supported by unique and scalable centralised logistics platform
Notes: Data as of November 2016.
A unique logistic platform… …providing key advantages
12
Source: Company information, Company elaborations based on market data.
Notes: (1) Based on an ad hoc survey carried out in December 2015, based on a nationally representative sample of 1,000 individuals aged 14+. Data shows % of advert recalls by those who have seen and remembered a main CE retailer advert, answering the questions (i) “For which retailers do you remember
reading/seeing/hearing an advertisement recently?” (spontaneous answers), and (ii) “Do you remember reading/seeing/hearing an advertisement recently for …[asked for each retailer]?” (prompted answers).
4 - Highly effective customer engagement…
Successful re-branding… …and effective marketing & communication strategy
From… …to
Re-branding programme launched after UniEuro acquisition
New store layout implemented in June – September 2014
New brand campaign launched in October 2014
Improved brand recognition
From… …to
43% of CE advert recalls are related to Unieuro vs. an average of
14% for competitors(1)
Major marketing effort post UniEuro acquisition
Advertising campaigns launched in festive season for maximum
brand building effect
11 13 15
17
43
Tro
ny
Me
dia
world
Expert
Eu
ronic
s
MediaWorld Euronics Trony Expert
% of advertising recall lift of main CE retailers, 14-20 December 2015(1)
13
Source:Company information, Company elaborations based on market data. Notes: ; (1) Based on an ad hoc survey carried out in December 2014, based on a nationally representative sample of 2,000 individuals aged 18+ who visited a CE retailer in the last 3 months. Data shows change in spontaneous awareness % from 2013 to 2014 in response to the question “Which CE retailers do you know even by name?”; (2) Based on same study as footnote 1. Data shows change in high “intention to buy” score % from 2013 to 2014 in response to the question “For your next CE purchase, how likely would you shop at…?”. Respondents answer on a scale from 1 to 10, with 8, 9, and 10 considered “high”.
…resulting in leading brand recognition
Fastest-growing brand awareness... …and intention to buy
17
(6)
(7) (7)
(10)
10
4
(2) (2)
(5)
MediaWorld Euronics Trony Expert MediaWorld
Expert
Euronics Trony
47%
96%
32%
95%
45%
91%
15%
83%
46%
97%
2014 spontaneous brand awareness
2014 total brand awareness 2014 intention to buy
41% 27% 26% 37% 45%
Change in spontaneous brand awareness post campaign (2013-2014 (pp))(1) Change in intention to buy (2013-2014 (pp))(2)
14
Italian Electronics Holdings S.r.l.DSG European Investments LimitedSilvestrini FamilyUnieuro's Top ManagementFree float
Shareholding Structure Evolution
• Offer size: 3.5 million shares, equal to 17.5% of the Company's issued share capital,
sold to institutional investors
• Price: 16.00 € per share
• Total consideration: 56 €m
• 90 days lock-up agreement
• Market capitalization at Placement price: 320 €m
33.8%
52.0%
Updated shareholding structure IPO (April 2017)
Placement (September 2017)
• Listing venue: Italian Stock Exchange, STAR Segment
• Offer size: 6.9 million shares, equal to 34,5% of the Company's issued share capital,
sold to institutional investors (37% of demand from Italian Investors; 63% from US, UK
and Continental Europe investors)
• Price: 11.00 € per share
• Total consideration: 76 €m
• Market capitalization at IPO: 220 €m
7.2%
4.7%
2.3%
Demerger of IEH (October 2017)
• Non-proportional demerger of majority shareholder
• Improved transparency of Unieuro chain of control
• Direct involvement of the Top Management in the shareholding structure
(1)
(2)
Notes: (1) Controlled by Rhône Capital (2) Controlled by Dixons Carphone Plc
15
• Overview of Unieuro
• Consumer Insight and Market Scenario
• Strategic Goals and Achievements
• H1 2017/18 Financials
• Closing Remarks
Summary
64% of customers are
omnichannel
86% of customers collect
information online
78% of customers test products
in traditional stores
64% of customers are omni-channel… and it is still growing
Info
search
Engage-
ment
Product
testing
Sale
support Payment
After sale/
Custom.
service Customer
22%
Heavy Digital
Digital 2 Digital
(all steps on Digital channel)
Libero tocco Aree Try out Staff efficace Omnichannel:
Digital 2 Store 2 Digital
(Start digital; test in store; close
digital)
20%
44%
Omnichannel:
Digital 2 Store
(Start digital; close in store)
Traditional:
Store 2 Store
(all steps in Store channel)
14%
Omnichannel approach: the key route to success
16
Loyalty card holders
45%
Non loyalty card holders
55%
1.0x
2.7x
7.7x
Online purchase
In-store purchase
Purchase in both channels
Strictly Private & Confidential
Loyalty customers are the proxy of omnichannel customers…
Source: Company information.
Notes: (1) As at 31 Aug. 2017; (2) Last 12 months as of Aug. 2017.
6.8 million members(1)
Customised awards, discounts, promotions
Frequent engagement via SMS and newsletter
Average ticket of loyalty card holders 128%
higher vs. non card holders
Non loyalty card holders Loyalty card holders
+128%
Loyalty program highlights
Non loyalty card holders Loyalty card holders
Average transaction value(2) (€) Average # items per transaction(2) (# items)
+25%
Sales split by customer type(2)
…omnichannel customers are more
valuable to retailers
Customer lifetime value
(indexed to “Online purchase”)
In the global retail industry, the expected
purchases attributed to the entire future
relationship with a customer (customer
lifetime value) is higher for omnichannel
customers
Omnichannel customers characterized by higher lifetime value
17
In mature markets, leading retailers with physical stores have managed to define successful responses
Current US CE market online penetration is
>3x online penetration on Best Buy revenues
Best Buy implemented an omnichannel
strategy in order to exploit growth
opportunities deriving from further penetration
of online channel
Best Buy operating profit almost doubled
in the two years following the
omnichannel plan implementation
Online penetration
Best Buy vs. US CE market (2015)
11%
37%
Onlinepenetration
Onlinepenetration
US CE market
Best buy response (Nov-12):
“Renew Blue" omnichannel plan
Redefining the
role of stores
Integrated
experience
across channels
Focus on service
and experience
to drive store
traffic
Increased focus on
“showrooms” allowing
customers to feel and
test products
Convenience focused
store footprint with a
greater share of small
format stores
Focus on building a
world class
e-commerce platform
with multiple
fulfilment options and
linked with the store
experience
Incorporate rewards
system to promote
loyalty and reinforce
desired behaviours
Geek Squad allows
for upselling of
additional services
and high margin
accessories
Service offering helps
drive store traffic and
promote customer
loyalty
1 2 3
Source: Best Buy investor presentation, earnings calls
What happened in mature markets
18
Further penetration of
online channel
Omnichannel approach is the key route to success
Increased focus on smaller size formats and proximity to
customer
c.10%
c.20%
>30%
Developmentstage
Growthstage
Maturitystage
Penetration of online
channel (%)
Online channel
Traditional
channel
Broad footprint & proximity to customer
Innovative role of store
Digitalisation of customer experience
Broad & personalized customer service
# stores
Avg. store size
1 2 3
Different stages of online
penetration in selected countries
Convergence of traditional and
online channel Relevant case studies in
mature markets
Source: Bain.
Key trends in the Italian CE market
19
CAGR 13-16
CAGR 16-17 YTD
Total 2.5% -0.4%
2.5%
-0.4%
Market growth from 2013 to 2016. Slight downturn in 2017 YTD
Source: Gfk
2013-2016 and YTD Consumer Electronics market evolution by category, €b
CAGR 13-16
CAGR 16-17 YTD
Total 2,9% -3,2%
2.9%
-3.2%
Fonte: GFK
2013-2016 and YTD Technical Superstore market evolution by category, €b
YTD Decrease in Technical Superstore Market
Weak Offline facing increasing Online penetration
Source: Gfk
2013-2016 and YTD Consumer Electronics market evolution by channel, €b
CAGR 13-16
CAGR 16-17 YTD
Total 2,5% -0,4%
2.5%
-0.4%
Online penetration
1.0% -0.2% 3.5% 0.1%
4.7% 3.1% 6.7%
11.2%
78.8%
35.4%
17.3%
49.8%
White Brown Grey Entertainment
Unieuro
Unieuro online
Total market
White goods: • MDA: growth driven by recovery in consumption: the kitchen category, dishwashers, and dryers confirmed the positive
trend especially in the online channel • SDA: positive performance positive, also driven by the online channel (especially home and kitchen care)
Brown goods: stable sales; large TV-sets growth
Grey goods: • Telecom: average price increase (launches of high-end models, i.e. Samsung S7); competitive pressure coming from telecom
retailers • IT: laptop segment contraction vs. excellent performances of slate PCs.
Unieuro(1): market share significantly growing in all product segments. White sales booming, especially MDA.
Notes: (1) Unieuro's growth per product category and single channel only concerns the Consumer segment net of Services, products outside the scope of consumer electronics, and includes Travel sales
FY 2016 FY 2017
Online +23%
Offline 0%
14.8 bln 15.1 bln
Total +2%
Market YoY%
Online +42.1%
Offline +3.4%
Total +5.5%
Unieuro YoY%
Growth: total Market up by 2.1% • offline segment stable • online sales +23% Competitive Scenario: increase in competitive pressure due to: • consolidation of the offline segment • online segment dynamics Internet penetration: approx. 12% in FY 2017 Unieuro: faster-paced growth compared to the market in both channels • online segment: growth rate approx. twice the market's.
Unieuro overperforming the market in FY 2016/17…
23
24
Online
+8.0%
…as well as in H1 2017/18
Offline
-1.8%
6.7 € bln 6.6 € bln
Total
-0.7%
Market YoY%
Online
+51.6%
Offline
+2.5%
Total
+5.9%
Unieuro(1) YoY%
Market trend: total market down by 0.7%. Q2 better than Q1
• offline segment: positive trend in July and August
• online sales: higher growth rate in Q2
Competitive Scenario: increasing competitive pressure, especially in
the Brown category
Internet penetration: approx. 13% in H1 2017/18
Unieuro(1): outperforming the market in both channels thanks to
acquisitions and unieuro.it organic growth, exceeding +30%
White goods:
• Kitchen category: positive trend, especially on the online channel
• Air conditioning: strong contribution to category performance
Brown goods: worsening performance mainly due to middle-segment TVs volume reduction
Grey goods:
• Telecom: growth in value driven by high-end smartphones launched in the last months
• IT: decrease in tablet and PC sales, undertaken by new products such as slate tablet PCs. Unfavorable new mix
Unieuro(1): material market share increase in all product segments
Strengthened positioning of IT and MDA products on the online channel, also thanks to Monclick consolidation
Significant growth in Brown despite market downturn and competitive pressure from Telecom Retailers
Notes: Source: Company elaborations on Gfk data. (1) Unieuro's growth per product category and single channel only concerns the Consumer segment net of Services, products outside the scope of consumer electronics, and includes Travel sales
H1 2016/17 H1 2017/18
2.2% -7.8% 0.0% -3.6%
11.8%
1.2% 3.0%
24.5%
60.9%
50.1%
39.3%
108.5%
White Brown Grey Entertainment
(1)
(1)
White Brown Grey Entertainment
25
Est. YoY 17 vs 16 – Offline
(Calendar year)
Est. YoY 17 vs 16 – Online
(Calendar year)
Value Volume Price Value Volume Price
~(-1,5%) ~+10,0%
CATEGORY DEVELOPING DRIVER
Total Market
White
MDA • In alignment with the first half of 2017, offline market is contracting (mostly due to price effect), while online
volume is strongly growing ~-(3,5%) ~+35,0%
SDA
• Growing offline price pressure pushes upwards estimated channel volumes
• Online growth trend is aligned with past performances, despite a normalization trend in volumes (>60% YoY
between 2013 and 2016 vs. ~30% expected for current year)
~(-1,0%) ~+20%
Home
Comfort • Market is strongly influenced by summer warmer climate and strongly volatile; for the future is foreseeable on
average a similar trend vs 2015/16 period. 0,0% 0,0%
Brown
Consumer
Electronics
• Contraction is in line with past performances of offline channel, due to the effect of decreasing volumes arising
from anticipated purchases for 2016 European Championships and product convergence
• More stable segment with price & volume trends in line with the past (excl. 2016)
~(-4,0%) ~(-2%)
Media
Storage • Expected a strong decrease in offline sales volume, partially counterbalanced by an in crease in prices (in line
with what observed during the 2013-16 period) due to a technology switch trend ~(-9,0%) ~+7,0%
Grey
Photo • The market is further re-focusing on top-line products and lenses, with an increase in average prices which is
insufficient to counterbalance volume reduction ~(-8,0%) ~(-0,5%)
IT • Confirming early 2017 trend, volumes are decreasing in the physical channel, while strongly growing on the
online counterpart. Prices are slightly decreasing on both channels. ~(-7,0%) ~+8,0%
Telecom • Sales value growth slowing vs past 2 years due to finalization of mobile-to-smartphone substitution (except small
gap) and stabilizing smartphone prices ~%3 ~+5,0%
=
= = = =
=
= >5% >1% -1%<x>1% <-1% <-5%
2017 Expected Trends
Offline channel -1,5%, while Online (excl. Entertainment) +10%
26
• Overview of Unieuro
• Consumer Insight and Market Scenario
• Strategic Goals and Achievements
• H1 2017/18 Financials
• Closing Remarks
Summary
27
Continue the profitable growth of the business by increasing market share in trending product categories (MDA, SDA, Telecom),
focusing on customer-centric approach and omnichannel opportunities VISION
ENABLER
Further boost to geography coverage and
development of proximity stores
Use physical assets with a view to
omnichannel exploitation
Ensure maximum website usability by
optimizing mobile opportunities
Value Customer Insight to maximize
engagement opportunities (frequency, average
ticket, margins)
Keep the attractiveness of stores high
Integration into the digital ecosystem
Proximity Experience Retail Mix
Brand Equity
Supply Chain
Partnership with Suppliers
Differentiation by distribution format
Strenghten positioning in the Service
segment; boost coverage of trending, high-
margin product categories
Expand the range
Unieuro’s Strategic Goals
OMNICHANNEL
OFFLINE
ONLINE
STRATEGIC
PILLAR
28
ENABLER
• Reopening of 21 former Andreoli stores
(1 July 2017), now Unieuro
• 2 new openings in Q1:
− Bergamo: travel DOS at Orio al Serio
airport
− Bergamo: store in the Oriocenter mall
• Contract signed for the acquisition of a
megastore in Rome (formerly operating
under the Trony banner), inside the
Euroma2 mall
Proximity Experience Retail Mix
Partnership with Suppliers: huge convention in Milan to present Unieuro’s new strategic approach and prospects
• Online sales substantially boosted by:
− continuous broadening of the
product range
− Growth in the White Goods
category, especially in the MDA
segment
H1 2017/18 Achievements
STRATEGIC
PILLAR
• 22 refurbishments (9 DOS, 13 affiliates);
2 DOS relocations
• Launch of Apple Pay
• Start of NPS measurement
• Customer Feedback Loop projects
implementation
• Several awards for digital and traditional
marketing activities:
− Netcomm e-Commerce Award
− Interactive Key Award
− Mediastars Award
− Mediakey Award)
Supply Chain: purchase of Oracle Retail suite to improve Unieuro’s centralized supply chain by optimizing stock levels across all channels
Brand Equity: working on the launch of a new ATL advertising campaign
Notes: (1) By buying group of entities operating under a single brand; (2) Pro-forma for the acquisition of Darty by Fnac; (3) Excluding VAT; (4) Top 3 companies combined addressable market share today vs. potential top 3 companies combined market share based on average of Germany, France and UK markets. Potential top 3 companies combined market share calculated by applying average consolidation level (79%) to 2015 Italian addressable market value. This is meant to illustrate the consolidation potential in the Italian market and is by no means a market consolidation projection; (5) In order to present addressable market size on a comparable basis for international markets the addressable market perimeter in Italy is calculated on a modified basis (see difference vs. figures presented on page 8) including mobile phones sold at full price vs. subsidised price (explaining €0.241bn gap), an adjusted retailer perimeter (explaining €0.231bn gap) and an adjusted category perimeter (explaining €0.128bn gap).
Ambition to create Italy’s leading CE retailer…
29
Italy considerably less consolidated than other Western European markets…
…presenting a €1.7bn consolidation opportunity
79%
88%
76%
73%
59%
Source: Company information, Planet Retail, Company elaborations based on market data.
6.6
4.9
Average (GER, FRA, UK)
Today (59% consolidation)
Potential (79% consolidation)
Combined addressable market share of top 3 companies(1) (2015) Italy consolidation potential: Top 3 companies combined sales today vs. potential (€bn)(3)(4)
9.1
10.3
10.3
13.6
17.1
23.3
6.0
10.2(5)
(2)
(2)
Others 41%
Unieuro 18%
Top 3 companies sales (€bn), incl. VAT
Addressable Market(5) (€bn)
Source: Planet Retail and Company information (Top 3 companies sales), Company elaborations based on market data (addressable market).
Consolidation potential: 1.7 €bn of which 0.3 €bn already aggretated by Unieuro in H1 2017/18
30
• Expanding the Unieuro store network in big cities, currently underpenetrated
• Further consolidating the offline market, taking advantage of competitors’ weaknesses
• 3,000 sqm store in the Euroma2 shopping mall, one of the biggest and
most visited in Rome:
• 230 stores, over 50,000 sqm
• Over 11 million visitors per year
• Situated in the EUR district, amongst the most important in Rome
• Formerly, the main Trony store in town
• No significant overlapping with Unieuro’s other stores (11, among which
the Muratella flagship)
• Opened on 20 September. All-time daily record sales for a Unieuro single
store
• 20-25 €m yearly sales expected at run-rate
EUROMA2: a new flagship store in Rome
Strategic
Rationale
…through offline expansion in big cities…
31
…as well as in the Italian province…
• Reaching a leadership position in target regions
• Further consolidating the offline market, still fragmented and very competitive
• Strengthening Unieuro's position vis-a-vis a direct competitor (buying group)
Further DOS network expansion in Central Italy through the acquisition
of assets belonging to Gruppo Cerioni S.p.A.
Strategic
Rationale
• 19 direct stores, currently operated under the Euronics brand:
• 12 stores in Marche, 7 in Emilia Romagna
• Ranging from 500 to 4,000 sqm each for 25,000 sqm sales area in total
• Over 200 headcounts
• Limited and perfectly manageable overlaps, to be managed through retail network
optimization actions
• Total consideration of 8.0 €m, 1.6 m of which at closing and 6.4 €m in semi-annual
instalments over the next three years. Stores acquired without stock
• Transaction closing to be finalized in several stages, mostly by the end of
November. Stores to be ready for the peak season
• Integration plan to be immediately run up, leveraging on Unieuro’s strong expertise in
external growth
• Target: over €90m of additional sales at run-rate within 12-18 months, with a profitability
in line with the Company’s targets. Existing Unieuro DOS
Newly acquired stores
Ravenna
Forlì
Cesena
Bologna
Ancona
Pesaro
Ascoli
Piceno
Perugia
Firenze
Rimini
Macerata
32
…while focusing on customer-centric approach
• Becoming market leader in terms of customer experience
• Continuously improving service quality
• Analyzing insights to maximize engagement opportunities of the customer base
Strategic
Rationale
Net Promoter Score (NPS) measurement to continuously
monitor Voice of Customer
• Project started in February 2017
• 490 stores involved (both DOS and wholesale partners), i.e. the entire
store network as well as the digital platform (website and app)
• 180,000 emails sent, 19,000 feedbacks obtained: excellent result in terms
of response rate
• Outstanding average score: 8.2
• Unieuro overall NPS (direct channel): 40.5(1)
• Data segmentation according to touch points used by customers during
their shopping experience (pure traditional, multichannel, pure digital)
• Implementation of general and local projects to build up a Feedback Loop,
thus improving customer experience, thanks to obtained insights
Notes: (1) NPS measured from 3 February 2017 to 29 September 2017.
Net Promoter Score (NPS) measures customer experience and predicts business growth.
It is based on the answer to a key question: “How likely are you to recommend Unieuro to a
friend or colleague?”
Respondents use a 0-10 score and are grouped as follows:
Subtracting the percentage of Detractors from the percentage of Promoters yields the Net
Promoter Score, which can range from -100 (if every customer is a Detractor) to 100 (if every
customer is a Promoter).
33
• Overview of Unieuro
• Consumer Insight and Market Scenario
• Strategic Goals and Achievements
• H1 2017/18 Financials
• Closing Remarks
Summary
34
H1 16/17
H1 17/18 3.1
2.4
Key Financials
Notes: Unieuro H1 ends on 31 August. (1) LFL sales include DOS and “Click & Collect” sales. (2) Leverage ratio is calculated as Net Financial Position divided by Last Twelve Month Adjusted EBITDA.
H1 16/17
H1 17/18
H1 16/17
H1 17/18 14.7
13.6
2.0 28 Feb. 2017
31 Aug. 2017
• H1 impacted by typical negative seasonality effects
• Acquisitions effect in H1 amounting to 26.9 €m (total consideration and capex)
• Improvement in NFP vs. 31 Aug. 2016 (79.0 €m) despite dividends and acquisitions
(149,7)
(147.2) 31 Aug. 2017
28 Feb. 2017
1.8%
1.8%
EBITDA margin
0.4%
0.3%
Net Income margin
1.1X
0.03X
Leverage(2)
LFL growth(1)
-2.3%
Consolidated Sales (€m)
Consolidated Adj. EBITDA (€m)
Consolidated Adj. Net Income (€m)
Net Financial Debt (€m)
Adj. Levered Free Cash Flow (€m)
Net Working Capital (€m)
-1.7% +29.2%
6.9%
813.7
761.5
+8.1%
75.8
• LFL sales penalized by tough comparison basis; overperforming the offline
market if net of major refurbishments in H1 16/17 (i.e. Roma Muratella)
• Andreoli, Monclick and new openings largely offsetting LFL decrease
• H1 profitability not very significant due to typical seasonality effects
• EBITDA up 8.1% driven by gross profit increase, margin at the same level of
the prior year
• Net interests efficiency and lower taxes partially offset by higher D&A
• Strong FCF performance boosted by Net Working Capital management and
lower interests; +54% vs. prior year
• NWC at the same level as 28 Feb. 2017 (+2.5 €m) vs. +46.0 €m in H1 last year
• Acquisitions and continuous NWC control offsetting seasonality effect
H1 16/17
H1 17/18(26.8)
(49.6)
+46.0%
35
Key Operational Data
Notes: Unieuro H1 ends on 31 August. (1) Active loyalty customers defined as customers who made at least a transaction within the last 12 months.
• Andreoli (270), Monclick (47) and new openings (75) effect, including Euroma2
• HQ headcount growing proportionally less than sales
28 Feb. 2017
31 Aug. 2017
Workforce (FTEs)
28 Feb. 17
31 Aug. 17
Loyalty Card Holders (millions)
• Andreoli effect increasing total sales area
• New stores average size: around 1,200 sqm, in line with resizing strategy
28 Feb. 2017
31 Aug. 2017 ~4,618
~4,630
Sales density
(€/sqm, LTM)
~276,000
Total Retail Area (sqm DOS only)
28 Feb. 2017
31 Aug. 2017
28 Feb. 2017
31 Aug. 2017
• 21 new DOS in central Italy, formerly Euronics managed by Andreoli S.p.A., in Q2
• 2 new openings in Q1 (Oriocenter and Orio al Serio Airport)
• Ongoing rationalization of wholesale partners network
• Pick-up points: 395 (83% of total stores)
Unieuro’s Retail Network
DOS (units)
WHOLESALE PARTNERS (units)
Openings
+23
+2
Closures
-
-9
Pick-up
Points
192
169
203
212
-0.3%
+6.2%
203
180
280
273
6.4
6.8
3,818
3,395
+12.5%
~302,800
1.5
• Card holders base growing
• 1.5 million active loyalty customers(1)
1.5
36
• Grey: 382.7 €m
− Good performance in consumer segment, partially offset by B2B
• White: 225.7 €m
− Retail mix optimization; broader product range
• Brown: 139.1 €m
− Positive impact from Monclick’s B2B2C consolidation
• Services: 28.7 €m
− Positive H1 driven by extended warranties services
• Other: 37.5 €m
− Strong performance for hoverboards, bicycles and games
Sales Breakdown
• Retail: 572.3 €m
− Boost from acquisitions (Andreoli) and new openings
• Wholesale: 99.3 €m
− Weak trend, also impacted by rationalization of wholesale
partners network and inventory optimization
• Online: 71.6 €m
− Strong organic growth (+30%) and MC consolidation (10.5 €m)
• B2B: 58.6 €m
− Strong increase underpinned by Monclick acquisition (10.0 €m)
• Travel: 11.9 €m
− New openings contribution
Retail
572.3 €m
70.3%
Wholesale
99.3 €m
12.2%
Online
71.6 €m
8.8%
B2B
58.6 €m
7.2%
Travel
11.9 €m
1.5%
Grey
382.7€m
47.0%
Other
37.5 €m
4.6% Services
28.7 €m
3.5%
Brown
139.1 €m
17.1%
White
225.7 €m
27.7%
Sales by channel
Sales by product category
YoY change
+3.4%
-3.0%
+52.3%
+11.8%
+88.9%
+1.6%
+12.2%
+8.4%
+7.5%
+30.2%
37
Adj. EBITDA H116/17
Gross Profit Retail Rents Personnel Marketing Logistic Other Adj. EBITDA H117/18
Adjusted EBITDA Walk
Notes: Unieuro H1 ends on 31 August. P&L line items adjusted for non-recurring costs and business model change
11.3
(0.9)
(4.6)
1.4 (2.9)
(3.2)
13.6
14.7
• Increase in Gross Profit mainly driven
by both organic sales growth and
acquisitions; gross margin in line with
previous year
• Rental Costs increase fully ascribable
to acquisitions
• Personnel costs increase driven by
both acquisitions and HQ reinforcement
• Reduction in Marketing costs (over 1
€m), mainly related to a different
promotional calendar
• Increase in Logistics costs connected
to higher sales volume, especially MDA,
and home delivery growth
• Other costs increase also connected
to the new status of listed company
38
Adj. Net Income H116/17
Adj. EBITDA D&A Net Interests Taxes Fiscal impact of non-recurring items
Adj. Net Income H117/18
Adjusted Net Income Walk
Notes: Unieuro H1 ends on 31 August. P&L line items adjusted for non-recurring costs and business model change
2.4
1.1 (1.2)
0.4
1.1 (0.7)
3.1
• Increase in D&A due to higher capex,
also connected to new openings
• Net interests efficiency mainly driven by
yoy improvement in average NFP as well
as lower interest rates
• Positive contribution by Income Taxes
(from positive 1.1 €m in H1 16/17 to
positive 2.2 €m in H1 17/18)
39
Net Debt 28Feb. 2017
Net Interests Taxes Paid Capex Non-RecurringInvestments
Dividends ReportedEBITDA
Change inNWC
Other Net Debt 31Aug. 2017
Financial Overview
Net Financial Position walk (€m)
Net Working Capital (€m)
Notes: Unieuro H1 ends on 31 August. (1) Change in NWC calculated as: +2.0 €m Change in NWC (Balance Sheet) + 2.0 €m Andreoli Personnel debt included in total consideration -0.2 €m Other minors.
0.0 2.0
75.8
23.0
19.4
20.0
3.8
4.2
0.9 2.6
7.5 €m Capex related to
Andreoli stores
reopening and Euroma2
• Net Financial Position impacted by:
• Dividend payment
• Non-recurring investments, including Andreoli (9.4 €m) and
Monclick (10.0 €m, 6.5 of which postponed over the next 5 years)
• Capex, partially related to recently acquired assets
• Net interests, including non-recurring financing fees related to the
new Acquisition Facilities (2.3 €m)
• NWC almost stable in H1 despite seasonal cash absorption due to the new
stores fitting effect
31 Aug. 2017 28 Feb. 2017
Trade receivables 54.2 35.2
Inventories 312.4 269.6
Trade payables (388.5) (334.5)
Trade working Capital (21.9) (29.8)
Other NWC (125.3) (119.9)
Net Working Capital (147.2) (149.7)
(1)
40
Net Debt 31 Aug.2016
Dividends Acquisitions Capex onAcquisitions
RecurringOperating Cash
Flow
Net Debt 31 Aug.2017
LTM Net Financial Position Walk
78.9
23.9
19.4
7.5
53.9
75.8
• Impressive operating cash flow
generation in the last twelve months
• Lower Net financial debt despite
dividend payment and acquisitions
41
Adjusted Levered Free Cash Flow Walk
Notes: Unieuro H1 ends on 31 August.
Δ Net Financial
Position H1 17/18 Dividend
Acquisitiondebt Other
Non-recurringinvestmentsnet of Acq.
DebtP&L non-
recurring items
Adjustment fornon-cash non-recurring items
Fiscal Impactof non-
recurring items
Adjustedlevered freecash flow H1
17/18
Reported levered free
cash flow: 49.0 €m
(73.8) 20.0
6.5
12.9
14.4
(1.7)
(4.1)
(0.9)
(26.8)
• Acquisition debt related to Monclick
postponed cash-out
• Non-recurring investments including
Andreoli and Monclick cash-out
• P&L non-recurring items as listed on
slide 29
Non-recurring investments
42
Category Product Growth driver
White goods
Brown goods
Grey goods
Other consumer electronics
(entertainment)
Future growth drivers
4
2
43
• Overview of Unieuro
• Consumer Insight and Market Scenario
• Strategic Goals and Achievements
• H1 2017/18 Financials
• Closing Remarks
Summary
44
Closing Remarks
• Unieuro as the only omnichannel consolidator in the Italian consumer electronics market,
through organic growth and M&A operations
• Competitive advantage strengthening thanks to the sales channel integration strategy
• Customer Centrality at the heart of the business model, starting with CRM building
• Voice of Customer as a pillar of decision-making and customer touchpoints
continuous improvement process
• Further value creation thanks to cash generation, future tax savings and debt reimbursement
• Dividend policy confirmed: 50% of Adjusted Net Income
Notes: Consumer segment only
45
Annex
46
This presentation contains certain items as part of the financial disclosure which are not defined under IFRS. Accordingly, these items do not have standardized meanings and may not be directly
comparable to similarly-titled items adopted by other entities.
Unieuro Management has identified a number of “Alternative Performance Indicators” (“APIs”). These APIs are (i) derived from historical results of Unieuro S.p.A. and are not intended to be
indicative of future performance, (ii) non-IFRS financial measures and, although derived from the Financial Statements, are unaudited and (iii) are not an alternative to financial measures
prepared in accordance with IFRS.
The APIs presented herein are Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income (loss) for the year, Adjusted levered free cash flow, Cash conversion index, Net financial debt,
Net financial debt to Adjusted EBITDA ratio, Leverage ratio.
In addition, this presentation includes certain measures that have been adjusted by us to present operating and financial performance net of any non-recurring events and non-core events. The
adjusted indicators are: Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income (loss) for the year, Adjusted levered free cash flow and Net financial debt to Adjusted EBITDA ratio.
In order to facilitate the understanding of our financial position and financial performance, this presentation contains other performance measures, such as Net working capital.
These measures are not indicative of our historical operating results, nor are they meant to be predictive of future results.
These measures are used by our management to monitor the underlying performance of our business and operations. Similarly entitled non-IFRS financial measures reported by other companies
may not be calculated in an identical manner, consequently our measures may not be consistent with similar measures used by other companies. Therefore, investors should not place undue
reliance on this data.
Non-IFRS and Other Performance Measures
47
Profit & Loss
€m, unless otherwise stated
H1 17/18 % H1 16/17 % Q2 17/18 % Q2 16/17 %
813.7 761.5 Sales 446.9 399.1
813.7 761.5 Sales 446.9 399.1
(638.2) (78.4%) (596.0) (78.3%) Purchase of goods - Change in Inventory (350.2) (78.4%) (311.0) (77.9%)
(30.6) (3.8%) (28.9) (3.8%) Rental Costs (16.1) (3.6%) (14.4) (3.6%)
(25.8) (3.2%) (26.5) (3.5%) Marketing costs (12.3) (2.7%) (12.3) (3.1%)
(18.9) (2.3%) (15.4) (2.0%) Logistic costs (10.9) (2.4%) (8.0) (2.0%)
(28.7) (3.5%) (22.9) (3.0%) Other costs (14.9) (3.3%) (11.2) (2.8%)
(72.0) (8.8%) (65.6) (8.6%) Personnel costs (38.1) (8.5%) (32.6) (8.2%)
(2.1) (0.3%) (0.6) (0.1%) Other operating costs and income (1.0) (0.2%) (0.5) (0.1%)
(2.6) (0.3%) 5.6 0.7% EBITDA Reported 3.4 0.8% 9.1 2.3%
14.4 1.8% 3.8 0.5% Adjustments 9.3 2.1% 2.2 0.6%
2.9 0.4% 4.2 0.6% Change in Business Model 1.5 0.3% 2.0 0.5%
14.7 1.8% 13.6 1.8% Adjusted EBITDA 14.1 3.2% 13.4 3.3%
(9.8) (1.2%) (8.6) (1.1%) D&A (5.1) (1.1%) (4.2) (1.0%)
(2.5) (0.3%) (2.9) (0.4%) Financial Income - Expenses (1.3) (0.3%) (1.4) (0.3%)
(14.9) (1.8%) (5.9) (0.8%) Profit before Tax (3.0) (0.7%) 3.6 0.9%
2.2 0.3% 1.1 0.1% Taxes 0.4 0.1% (0.7) (0.2%)
(1.5) (0.2%) (0.8) (0.1%) Fiscal impact of non-recurring items (0.9) (0.2%) (0.5) (0.1%)
3.1 0.4% 2.4 0.3% Adjusted Net Income 7.2 1.6% 6.6 1.6%
(14.4) (1.8%) (3.8) (0.5%) Adjustments (9.3) (2.1%) (2.2) (0.6%)
(2.9) (0.4%) (4.2) (0.6%) Change in Business Model (1.5) (0.3%) (2.0) (0.5%)
1.5 0.2% 0.8 0.1% Fiscal impact of non-recurring items 0.9 0.2% 0.5 0.1%
(12.6) (1.5%) (4.8) (0.6%) Net Income Reported (2.6) (0.6%) 2.9 0.7%
48
Profit & Loss Adjustments by Line Item
€m, unless otherwise stated
Δ H1 Reported
EBITDA
H1 17/18
Adjustments
H1 16/17
Adjustments
Δ H1 Adjusted
EBITDA
Δ Q2 Reported
EBITDA
Q2 17/18
Adjustments
Q2 16/17
Adjustments
Δ Q2
Adjusted
EBITDA
10.0 2.7 (0.1) 12.6 Gross Profit 8.6 2.7 (0.1) 11.2
2.9 (4.2) (1.3) Change in Business Model - 1.5 (2.0) (0.6)
10.0 5.6 (4.3) 11.3 Gross profit including change in Business Model 8.6 4.2 (2.1) 10.6
(1.7) 0.7 0.1 (0.9) Rental Costs (1.7) 0.4 0.3 (0.9)
0.7 1.0 (0.3) 1.4 Marketing costs (0.0) 0.6 (0.2) 0.4
(3.5) 0.7 (0.1) (2.9) Logistic costs (2.9) 0.7 (0.1) (2.3)
(5.8) 5.7 (2.1) (2.2) Other costs (3.7) 2.6 (1.0) (2.1)
(6.4) 3.3 (1.5) (4.6) Personnel costs (5.6) 2.5 (0.8) (3.9)
(1.5) 0.3 0.2 (1.0) Other operating costs and income (0.6) (0.1) (0.4) (1.1)
(18.2) 11.7 (3.7) (10.2) Total Costs (14.3) 6.6 (2.1) (9.9)
(8.2) 17.3 (8.0) 1.1 Total (5.7) 10.7 (4.2) 0.7
49
Balance Sheet
€m, unless otherwise stated
31 Aug. 2017 28 Feb. 2017 (1) Current Tax Assets: Includes Current Tax Assets and Fiscal Consolidation Receivables
Trade Receivables 54.2 35.2
Inventory 312.4 269.6 (2) Current Assets: Includes mainly Accrued Income related to rental costs, etc
Trade Payables (388.5) (334.5)
Operating Working Capital (21.9) (29.8) (3) Current Liabilities
Current Tax Assets (1) 11.3 8.0 31 Aug. 2017 28 Feb. 2017
Current Assets (2) 16.2 13.9 Accrued expenses (mainly Extended Warranties) (85.5) (88.7)
Current Liabilities (3) (147.6) (140.3) Personnel debt (30.9) (28.2)
Short Term Provisions (5.2) (1.4) VAT debt (18.1) (15.7)
Net Working Capital (147.2) (149.7) Other (13.0) (7.7)
Tangible and Intangible Assets 93.2 72.6 Current Liabilities (147.6) (140.3)
Net Deferred Tax Assets and Liabilities 26.4 29.1
Goodwill 170.8 151.4 (4) Other Long Term Assets and Liabilities
Other Long Term Assets and Liabilities (4) (14.3) (16.5) 31 Aug. 2017 28 Feb. 2017
Total Invested Capital 128.9 86.9 Deposits 3.2 2.1
Net financial Debt 75.8 2.0 Deferred Benefit Obligation (TFR) (10.9) (9.8)
Equity 53.1 85.0 Long Term Provision for Risks (5.2) (7.2)
Total Sources 128.9 86.9 Store Loss Provision (0.4) (0.6)
Other Provisions (1.0) (1.0)
Other Long Term Assets and Liabilities (14.3) (16.5)
50
Cash Flow Statement
€m, unless otherwise stated
H1 17/18 H1 16/17 Q2 17/18 Q2 16/17
(2.6) 5.6 Reported EBITDA 3.4 9.1
- - Taxes Paid
(4.2) (1.8) Interests Paid (3.2) (0.8)
(3.8) (45.0) Change in NWC 17.2 (10.7)
(2.8) 1.1 Change in Other Assets and Liabilities (3.5) 0.5
(13.4) (40.1) Reported Operating Cash Flow 13.9 (1.8)
(17.0) (10.3) Purchase of Tangible Assets (11.2) (6.1)
(6.0) (1.6) Purchase of Intangible Assets (4.5) (1.0)
(12.9) - Acquisitions (3.5) -
0.2 - Monclick NFP 01.06.2017 0.2 -
(49.0) (52.0) Levered Free Cash Flow (5.1) (9.0)
9.4 2.4 Adjustments 5.3 1.4
12.9 - Non recurring investments 3.5 -
(26.8) (49.6) Adjusted Levered Free Cash Flow 3.7 (7.6)
(9.4) (2.4) Adjustments (5.3) (1.4)
(12.9) - Non recurring investments (3.5) -
(20.0) Debt to Shareholders (non cash effect) (20.0) -
(6.5) Debt Acquisition Monclick (non cash effect) (6.5) -
1.7 (1.0) Other Changes 1.9 (0.5)
(73.8) (53.0) Δ Net Financial Position (29.7) (9.5)
51
“Reported EBITDA” To “Adjusted EBITDA” Reconciliation
€m, unless otherwise stated
H1 17/18 H1 16/17 Q2 17/18 Q2 16/17
(2.6) 5.6 EBITDA Reported 3.4 9.1
2.7 0.7 IPO 0.0 0.5
0.7 1.2 Call options agreement (0.0) 0.6
1.3 1.0 Stores opening - relocations (ex UE) - closing costs 0.7 0.4
2.7 - Accidental events 2.7 -
6.1 0.1 Merger and Acquisition 5.4 0.2
0.9 0.8 Other 0.4 0.4
14.4 3.8 Non-Recurring Items 9.3 2.2
2.9 4.2 Extended warranties adjustment 1.5 2.0
14.7 13.6 EBITDA Adjusted 14.1 13.4
52
“Net Income” To “Adjusted Net Income” Reconciliation
€m, unless otherwise stated
H1 17/18 H1 16/17 Q2 17/18 Q2 16/17
(12.6) (4.8) Reported Net Income (2.5) 2.9
14.4 3.8 Non-Recurring Items (see previous slide) 9.3 2.2
2.9 4.2 Extended warranties adjustment 1.5 2.0
(1.5) (0.8)Fiscal Impact of non-recurring items and extended warranties
adjustment(0.9) (0.5)
3.1 2.4 Adjusted Net Income 7.2 6.6
53
Levered FCF To Adjusted Levered FCF Reconciliation
€m, unless otherwise stated
H1 17/18 H1 16/17 Q1 17/18 Q1 16/17
(49.0) (52.0) Levered Free Cash Flow (5.1) (9.0)
14.4 3.8 P&L non-recurring items 9.3 2.2
(4.1) (1.2) Adjustment for non-cash non-recurring items (3.5) (0.7)
(0.9) (0.2) Fiscal Impact of non-recurring items (0.5) (0.1)
12.9 - Non recurring investments 3.5 -
22.3 2.4 Total Adjustments 8.8 1.4
(26.8) (49.6) Adjusted levered free cash flow 3.7 (7.6)
54
Net Financial Position
€m, unless otherwise stated
31 Aug. 2017 28 Feb. 2017
Bilateral Facility 3.6 -
Revolving Credit Facility 21.0 -
Other Short Term Bank Debt -
Short-Term Bank Debt 24.6 -
Term Loan A 4.5 6.0
Term Loan B 13.3 13.3
Capex Facility 13.5 14.3
Acquisition Facility 20.0
Financing Fees (3.6) (1.8)
Long-Term Bank Debt 47.7 31.8
Bank Debt 72.3 31.8
Shareholder Debt (Dividends) 20.0 -
Debt To other lenders 6.1 6.8
Acquisition Debt 6.5
Other Financial Debt 32.6 6.8
Cash and Cash Equivalents (29.1) (36.7)
Net Financial Debt 75.8 2.0
55
INVESTOR CONTACTS
Italo Valenti
CFO & Investor Relations Officer
Andrea Moretti
Investor Relations Manager
+39 335 5301205
+39 0543 776769